demands by the unions representing its employees in upcoming contract talks.

Finance Minister the Hon. David Saul said Government will be laying a wage freeze or only a meagre increase on the table when the first round of negotiations gets underway later this month.

"Everyone must appreciate by now the seriousness of the economic situation,'' Dr. Saul said. "There is enough evidence the economy is in the doldrums. Any claim for a large wage increase would be unrealistic.'' He was commenting on bank chief Mr. J. Michael Collier's call for Government to lead the way in implementing an Island-wide wage and salaries freeze.

The Bank of Butterfield's chief general manager also called on Government to slash the number of GP vehicles on the roads, curb the number of people it employs and generally cut back spending.

However, Dr. Saul said big steps had already been taken in all four areas.

"We have made significant, real cuts,'' he said.

He pointed out a ban had already been slapped on new Government vehicles. And if a replacement vehicle is needed, employees "had better make a case for it''.

"We are trying to keep a pool of cars available so that when one is needed, the employee can go to the pool,'' he said. "The point is people do get annoyed when they see all the GP cars on the roads.'' Mr. Collier estimated there were more than 75 GP cars on the roads, when 15 years ago there was one.

Responding to Mr. Collier's claim Government had "cut into muscle'' by reducing Police recruitment activities, Dr. Saul said it could not be helped.

"All Government departments had to make reductions and the Police agreed to do it too,'' he said.

Dr. Saul said Government had been cutting its programmes at the rate of $17 million for the past few years. He added: "We are in the middle of preparing next year's Budget and Mr. Collier is right, it's a real challenge.

"We are working with all Government departments and there will certainly have to be cutbacks.'' He did not yet know which Government programmes would feel the knife first.